The OECD on 14 November 2023 released the Mutual Agreement Procedures (MAP) Statistics for 2022, which revealed that the number of new MAP cases opened in 2022 increased by almost 3% compared to 2021 but the number of cases closed decreased by approximately 4%.
The latest MAP statistics cover a record 133 jurisdictions and practically all MAP cases worldwide. These statistics form part of the BEPS Action 14 Minimum Standard and the broader G20/OECD tax certainty agenda to improve the effectiveness and timeliness of tax-related dispute resolution mechanisms.
The award for the two jurisdictions that dealt most effectively with their joint caseload went to Denmark and Ireland for transfer pricing cases. Finally, the award for most improved jurisdiction went to the Netherlands, which closed 102 more cases with positive outcomes in 2022 than in 2021.
Laurie Dicker
BDO in United States
The latest MAP statistics cover a record 133 jurisdictions and practically all MAP cases worldwide. These statistics form part of the BEPS Action 14 Minimum Standard and the broader G20/OECD tax certainty agenda to improve the effectiveness and timeliness of tax-related dispute resolution mechanisms.
MAP trends
The 2022 MAP statistics show the following trends:- Taxpayers are engaging with MAP more than ever. The number of new MAP cases opened in 2022 increased by almost 3% compared to 2021, a welcome sign after a decrease in cases opened in 2021.
- More specifically, 2493 “new” cases (those received on or after 1 January 2016 or 1 January of the year a jurisdiction joined the Inclusive Framework) were started in 2022, and 2086 were closed, but with a starting inventory of 4990 cases, the final number of cases in inventory at the end of 2022 was 5398. In addition, there are 1018 “old” cases (those received prior to 1 January 2016 or 1 January of the year of joining the Inclusive Framework) left in inventory at the close of 2022. For transfer pricing cases, the year started with 662 old cases and 2670 new cases in inventory, for a total of 3,332 transfer pricing cases in inventory. During the year, 1166 new cases were opened, and 1117 were closed (133 old cases and 984 new ones). At the end of 2022, transfer pricing inventory stood at 529 old cases and 2853 new cases.
- Fewer MAP cases were closed in 2022. Approximately 4% fewer MAP cases were closed in 2022 than in 2021. The decline for transfer pricing cases was only 0.5%, while other cases were down by approximately 6.5%. But the OECD believes the 2022 results represent a “return to baseline” and that the particularly high number of cases closed in 2021 (up 12% from 2020) was due primarily to many competent authorities prioritising simpler cases.
- Outcomes remain generally positive. Around 73% of the MAPs concluded in 2022 fully resolved the issue both for transfer pricing and other cases. Only 2% of MAP cases were closed with no agreement.
- Average case times are near the 24-month target. On average, MAP cases closed in 2022 took 25.3 months, compared to 26 months in 2021, moving closer to the target of closing in 24 months. Transfer pricing cases took a slightly longer 29 months to close, down from 32.3 months in 2021, but this is the first time this number has been below 30 months.
MAP awards
The OECD also revealed this year's MAP Awards, which recognise the efforts of specific competent authorities. Netherlands took home the award for the shortest average time to close transfer pricing cases, with an impressive average of 19.6 months.The award for the two jurisdictions that dealt most effectively with their joint caseload went to Denmark and Ireland for transfer pricing cases. Finally, the award for most improved jurisdiction went to the Netherlands, which closed 102 more cases with positive outcomes in 2022 than in 2021.
Laurie Dicker
BDO in United States